Competitive Analysis

Definition:Identifying your competitors and evaluating their strategies to determine their strengths and weaknesses relative to those of your own product or service

A competitive analysis is a critical part of your company
marketing plan. With this evaluation, you can establish what makes
your product or service unique--and therefore what attributes you
play up in order to attract your target market.

Evaluate your competitors by placing them in strategic groups
according to how directly they compete for a share of the
customer's dollar. For each competitor or strategic group, list
their product or service, its profitability, growth pattern,
marketing objectives and assumptions, current and past strategies,
organizational and cost structure, strengths and weaknesses, and
size (in sales) of the competitor's business. Answer questions such
as:

Who are your competitors?

What products or services do they sell?

What is each competitor's market share?

What are their past strategies?

What are their current strategies?

What type of media are used to market their products or
services?

How many hours per week do they purchase to advertise through
the media used in this market?

What are each competitor's strengths and weaknesses?

What potential threats do your competitors pose?

What potential opportunities do they make available for
you?

A quick and easy way to compare your product or service with
similar ones on the market is to make a competition grid. Down the
left side of a piece of paper, write the names of four or five
products or services that compete with yours. To help you generate
this list, think of what your customers would buy if they didn't
buy your product or service.

Across the top of the paper, list the main features and
characteristics of each product or service. Include such things as
target market, price, size, method of distribution, and extent of
customer service for a product. For a service, list prospective
buyers, where the service is available, price, website, toll-free
phone number, and other features that are relevant. A glance at the
competition grid will help you see where your product fits in the
overall market.